Abstract

Human capital plays an important role in the theory of economic growth, but it has been difficult to measure this abstract concept. We survey the psychological literature on cross-cultural IQ tests and conclude that intelligence tests provide one useful measure of human capital. Using a new database of national average IQ, we show that in growth regressions that include only robust control variables, IQ is statistically significant in 99.8% of these 1330 regressions, easily passing a Bayesian model-averaging robustness test. A 1 point increase in a nation’s average IQ is associated with a persistent 0.11% annual increase in GDP per capita.

Gottfredson, L. 2004Intelligence: Is it the epidemiologists’ elusive ‘fundamental cause’ of social class inequalities in health?Journal of Personality and Social Psychology86174199CrossRefGoogle Scholar

Winship, C., & Korenman, S. (1997). Does staying in school make you smarter? The effect of education on IQ, In The Bell Curve, In Intelligence, Genes, and Success: Scientists Respond to the Bell Curve. New York, NY: Springer-Verlag.Google Scholar